CONSUMPTION AND DISTRIBUTIONAL CONFLICTS IN DEMAND-LED GROWTH MODELS: EVIDENCE FROM THE PSID DATA
Journal Title: Cadernos CEPEC - Year 2024, Vol 13, Issue 2
Abstract
Post-Keynesian growth models have incorporated household wealth dynamics as an important aspect of the relationship between growth and income distribution. Following these lines, this paper suggests a model in which households’ consumption decision is determined by a dynamic adjustment of wealth to a targeted level. We also suggest that households’ targeted level of wealth takes into account the average income that they earn over a period of eight years. We then run an empirical estimation using microlevel data for wealth and wages of US households available in the PSID (Panel Study on Income Dynamics) Database. We find that the model yields statistically significant results for most income and age groups. We also observe that the targeted wealth to wage ratio is not constant across groups of income and age. This ratio tends to increase with income and is actually negative for the lowest income bracket. This empirical analysis then suggests that there is evidence for claiming that household debt-financed consumption is a ’semi-autonomous’ component of demand and can be incorporated into a demand-led growth model to explain the trajectory of the US economy in the period under analysis.
Authors and Affiliations
Joana David Avritzer
Keywords
Related Articles
- EP ID EP751142
- DOI http://dx.doi.org/10.18542/cepec.v13i2.16991
- Views 37
- Downloads 0
DETERMINANTES DO IDEB NAS ESCOLAS MUNICIPAIS DO ESTADO PIAUÍ NOS ANOS INICIAIS DO ENSINO FUNDAMENTAL: UMA ANÁLISE ECONOMÉTRICA
A literatura da economia da educação tem concentrado esforços nos últimos anos em estudar os fatores determinantes do desempenho dos estudantes. No Brasil, o Ideb (Índice de Desenvolvimento da Educação Básica) tem sido a...
A EFICIÊNCIA DO SISTEMA NACIONAL DE INOVAÇÃO (SNI) PARA AS 50 MAIORES ECONOMIAS GLOBAIS: Uma Abordagem utilizando Fronteira Estocástica de Produção (SFA)
O objetivo desse artigo foi o de analisar e determinar a eficiência técnica para os SNIs das 50 maiores economias utilizando a metodologia adaptada de Ratner, Balashova e Lychev (2022). Bem como determinar as principais...
CONSUMPTION AND DISTRIBUTIONAL CONFLICTS IN DEMAND-LED GROWTH MODELS: EVIDENCE FROM THE PSID DATA
Post-Keynesian growth models have incorporated household wealth dynamics as an important aspect of the relationship between growth and income distribution. Following these lines, this paper suggests a model in which hous...
ACTIONABLE CULTURAL RESOURCES FOR SUSTAINABLE LOCAL TOURISM DEVELOPMENT – MERITS OF DIGITAL SUPPORT SYSTEMS
Sustainable tourism development is a major policy challenge for many cities, regions or countries. This paper describes various novel analytical ingredients to ensure a consistent and professional policy strategy in tour...
RESPONSES TO THE RECENT FINANCIAL AND ECONOMIC CRISIS: FROM HETERODOXY TO RETURN TO ORTHODOXY
This article briefly shows the responses of some developed and emerging countries to the financial crisis of 2007-2008, whose reflections are still felt nowadays. We stressed the first quite radical and fast responses to...